Technical analysis as at 22/9/2019
GBPUSD has reached the first resistance level in the past week, which we pointed out earlier. This level is in the band around 1.250-1.2570. The weekly chart, see Figure 1, shows that a candlestick has been formed that resembles a doji formation that signals market indecision. The market opened and closed on the same level last week.
Figure 1: GBPUSD on weekly chart
On the daily chart, see Figure 2, we see that, after bouncing off the double bottom support, the price continued to rise and break out from the declining channel. On September 19, 2019 the price surpassed the SMA 100. The following day, however, further growth was rejected and the price closed below this moving average. At the same time, however, the upper shadow of the candlestick from 20.9. is higher than the previous day.
The price also created a higher high compared to the previous high, which was created between 26-29 August. To definitely confirm the reversal of the trend, it is necessary to wait for the first higher low, which has not been created yet. The faster EMA 50 (red) is still below SMA 100 (green), indicating a continuing downtrend.
Figure 2: GBPUSD on daily chart
As the price is at its resistance, it is now possible to expect at least a slowdown in further price growth with the possibility of some consolidation or correction. For a long speculation, it is suitable wait for the pullback to the first support around the price level 1.23. If resistance on the moving average of SMA100 is significantly exceeded, then there will be a space for further strengthening.
is at a level around 1.250-1.2570.
is approximately 1.2750 - 1.2850. Here is a confluence with the Fibonacci level of 61.8 and the resistance that arose on May 17, 2019 by breaking through previous support.
is in zone 1.2280-1.2330
is in the band 1.20 - 1.2050.
Should the United Kingdom agree with the EU on the revised Brexit Agreement, this currency pair could be expected to continue to strengthen sharply.